Integrated Water Management A Tragedy of the Commons? 8 May Stormwater Victoria Conference

Transcription

1 Integrated Water Management A Tragedy of the Commons? 8 May Stormwater Victoria Conference

2 Agenda 1. Introduction Sarah Eggleton (MW) 2. Project Context Lachlan Johnson (MCC) 3. IWCM Learnings Lachlan Johnson (MCC)

3 INTRODUCTION Sarah Eggleton Melbourne Water

4 Project Context (0.1) Distribution Pipeline Freeway Golf Course (Boroondara) WSUD Works Bulleen Park (MCC) Carey Grammar 3 objectives: Bulleen catchment drainage outfall; Improve the quality of stormwater; and Provide alternative source of water for irrigation. Project Funding Partners: Melbourne Water; Manningham City Council; The City of Boroondara; Carey Grammar School; and The Commonwealth Government of Australia (Melbourne WaSSH). Project was initiated approximately 6 years ago.

5 Learning 1 Memorandum of Understanding (1.1) Proposed Wetland & Storage Site Develop a Memorandum of Understanding (MoU) between the project partners; Needs to be put in place early in the project concept development; Ensures individual and collective objectives are documented and agreed; Can and should contain caveats, given the early stage of project development; It is the framework for progressing the project;

6 Learning 2 Strong Business Case (2.1) Irrigation ( MoU should be supported by a strong business case and feasibility study; Feasibility study should build upon the principles agreed in the MoU; Forms the basis on which parties will assume risk and commit to short term and long term goals; Should contain realistic caveats reflective of the stage of project development; The business case is the lynch pin that enables parties to commit to the project; and Business case should reflect the savings that can be achieved through combined action, as opposed to individual solutions.

7 Learning 3 Shared Risk Approach (3.1) Proposed Irrigation Pipeline Alignment Business case should include a shared risk approach between project partners; There are significant risks and costs associated with the design of a project; Should include: Construction risk allocation; Design risks; Funding risks Capital & Operational; Water quality risks; Management arrangements; This approach assists in binding parties to the project and helps to foster inter-organisational trust;

8 Learning 3 Shared Risk Approach (3.2) Original Design Layout (GHD Pty Ltd) An example of the need to take a shared risk approach to project development was: During the design significant geotechnical issues were discovered; A large sand layer with high conductivity to the adjacent Yarra River was found to underlay the site; The sand layer meant that the proposed water bodies required raising to avoid conflict with the sand layer hydrostatic pressure and water retention; Ultimately the geotechnical issues resulted in a large increase in costs, both design and construction; Sand Layer Contour Map (Coffey Environmental Pty Ltd)

9 Learning 3 Shared Risk Approach (3.3) Another example of the need to take a shared risk approach was encountered when the decision was made to exclude the supply of water to the Billabong; Parks Victoria/DSE was a noncapital funding partner, but would have contributed to the OM&R costs; The resulting shortfall in OM&R funding towards the project placed a greater burden on the other parties; The approach taken distributes this risk amongst all and it is not shouldered by a single entity.

10 Learning 4 Development of Partnerships (4.1) Melbourne Water Manningham City Council The City of Boroondara Carey Grammar School IWCM projects do not fit neatly within many organisations core business or regulated boundaries; This is particularly relevant when operational, governance and maintenance outcomes are being considered; The project involves: Wetland; Sedimentation Basins; Pump Stations; Reticulated Irrigation Mains; Electrical & Telemetry Control Infrastructure; and Public Open Space.

11 Learning 4 Formalising Partnerships (4.2) Other considerations: Land tenure Multiple owners, leases and directly assigned management responsibility; Eventual asset ownership; Maintenance access rights; Leases, Licences or Crown Land Committee of Management (CoM); Legal liabilities; Financial arrangements; Administration and governance; Security of ongoing funds: Deeds and/or traditional contracts;

12 Learning 4 Formalising Partnerships (4.3) Arrangements between all the parties should be finalised and endorsed through a Binding Legal Agreement, including details on items such as: Funding arrangements; Governance arrangements; Land tenure and access arrangements for maintenance; Ongoing routine maintenance arrangements and replacement of assets at end of useful life; Decommissioning asset

13 Learning 5 IWCM Projects are Multifaceted (5.1) Crown Land Committee of Management Parks Victoria/DSE Manningham City Council (Asset Manager) Licence (s) The City of Boroondara Land Tenure/Governance Arrangements (The Public Land Consultancy) Carey Grammar School In order to address these issues, a Governance Options paper was prepared; The starting point was based on the land and governance issues; The paper concluded that a single entity should manage the project operation and financial arrangements; The paper suggested a governance structure & land tenure/access arrangements: Manningham City Council (MCC) Asset Manager; MCC enter into CoM arrangements to access Crown land; MCC enter into licences with other parties to access assets built on their land

14 Learning 6 Capital Commitments vs. Ongoing Operational Commitments (6.1) Sedimentation Basin Maintenance (WSUD Engineering Principals CSIRO) The reality is that IWCM projects have many and wide reaching benefits, therefore their operational costs are likely to be higher than traditional approaches; In order to sustain a project throughout its useful life span, ongoing financial/in-kind contributions are required; An important principal of the proposed governance structure was that it would be cost neutral to Manningham City Council (ie. the Council only pays its contribution); and As the asset manager, Council, would collect funds from the project partners to fund the administration and operation of the assets.

15 Learning 6 Capital Commitments vs. Ongoing Operational Commitments (6.2) After detailed design, a cost estimate for operation was prepared: Operational Electrical charges, telecommunication charges, accounts, auditing etc; Maintenance Pump servicing, wetland replanting, sedimentation basin desilting etc; and Renewal (Capital) Resetting of wetland, replacement of pumps etc. The purpose of the OMR schedule was to determine what contributions the project would require to function as an ongoing asset; The costs identified were separated into two categories and apportioned accordingly: Drainage authority costs Manningham City Council; and Harvested stormwater supply costs: Manningham City Council; The City of Boroondara; and Carey Grammar School.

16 Summary Water leadership requires collective learning and collective commitment to common objectives and action Lessons learnt: Develop a memorandum of understanding at an early stage of project concept development; Develop a strong, robust business case with realistic caveats to account for unknowns; Take a shared risk approach through the design, construction and maintenance; Develop partnerships with stakeholders with a clear understanding of individual requirements; Formalise partnerships with a binding agreement; IWCM is a multi-faceted endeavour; Consider operational requirements from an early stage as they are often complex to fund/administer.